Adler v. Campbell

BARNARD, P. J. This is an action for dissolution of a joint venture, for an accounting, and for declaratory relief.

On November 12, 1951, these parties entered into a construction contract under which the plaintiff, as contractor, agreed to build an 8-unit apartment house on “Law Street” for the defendants. Construction started in February, 1952, and was completed in September, 1952. That project is not directly involved in this action.

Shortly after November 12, these parties discussed the possibility of a joint venture in the erection of other buildings. On November 26,1951, they signed an agreement which was drawn by the plaintiff’s wife, who was admitted to practice law but who was in charge of the plaintiff’s office and who, through the period in question, took a leading part in carrying on his business affairs.

This agreement, after designating the defendants as owners and the plaintiff as contractor, recited that the owners “have heretofore purchased and are now purchasing” three described vacant lots for the purpose of having buildings erected thereon “for sale, exchange, rental or other income producing development,” and that the owners are desirous of engaging with the contractor, jointly, “in the business of developing the said lots.” It was then provided, so far as material here, that the owners were to furnish all funds required in the various projects, including necessary funds from lending institutions; that the contractor should furnish his services in the construction involved and should assist the owners in the selection of suitable building sites; that the net profits arising from said projects should be equally divided between the owners and contractor; that all expenses of every kind, except any allowance to the contractor or to the owners for their services, should be chargeable in computing the net profit; that the “net profit shall be the difference between lot cost, cost of plans, construction costs”; [423]that upon the final inspection by the building department of “any” construction under the contract the owners shall cause the title to be transferred so as to stand in the name of both parties; that “any project developed hereunder” should be sold only at a net profit of at least 20 per cent above the total cost, including the cost of construction, unless the parties agreed in writing to a smaller profit; and that this agreement should not apply to the apartment being erected under the agreement of November 12.